If a function calls itself using tail-recursion, a compiler can turn that into a loop without too much trouble. However, if it's tail-calling a different function then that becomes more difficult; it would have to merge the two functions into a single WASM function. And if the tail-call is indirect (through a function pointer) then it is impossible to turn into a loop.

> It feels like tail calls are too high level of a concept to be in an "assembly" language.

WASM is a bit higher level than typical assembly languages. It doesn't have unrestricted "goto", so there's no way to implement tail calls optimization the "hard way".